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April 25, 2001

GD to acquire Newport NewsGeneral Dynamics announced today that it has signed a definitive agreement to acquire Newport News Shipbuilding. The acquisition, approved by the boards of directors of both companies, is to be accomplished through a cash tender offer for all of Newport News Shipbuilding's publicly held outstanding shares at a price of $67.50 per share. The transaction is valued at approximately $2.6 billion, which includes the assumption of approximately $500 million of Newport News Shipbuilding debt. The tender offer will begin within seven business days. The acquisition, subject to the tendering of a majority of the Newport News Shipbuilding shares as well as regulatory review, is expected to close in the third quarter of 2001.

Following the completion of the tender offer and necessary approvals, General Dynamics intends to consummate a second-step merger in which all of the remaining Newport News Shipbuilding shareholders receive the same price paid in the tender offer.

This is the second attempt by General Dynamics to buy Newport News. The first bid, announced in 1999, was rejected by the U.S. Department of Defense since it would have created a monopoly builder of attack submarines and would leave only one company in charge of nuclear work. Apparently, the two companies believe that the Bush Administration will look more kindly than its predecessor on defense mergers.

"Newport News is a solid, well-run company with sustainable revenues and earnings and strong cash flow. Our offer reflects its inherent worth, offers Newport News shareholders an attractive premium, and provides a wonderful opportunity to save significant amounts of money for the U.S. Navy while retaining both nuclear shipyards,'' said Nicholas D. Chabraja, General Dynamics chairman and CEO.

William P. Fricks, chairman and CEO of Newport News Shipbuilding, said, "This acquisition will provide Newport News shareholders an attractive price, and our employees will benefit from being part of a larger, more diverse company. It will enhance job security, and provide more career choices in a wider enterprise. Today, Newport News is the nation's sole supplier of aircraft carriers, and we're teamed with Electric Boat on the Navy's only new submarine program. Combining our companies will provide our customers with significant cost savings to support the nation's need to build more nuclear ships.''

More ripples from FGH filingPasha Hawaii Transport Lines LLC (PHTL) said yesterday that Friede Goldman Halter’s Chapter 11 filing would have minimal impact on the construction of PHTL's new Jones Act Ro-Ro vessel. FGH’s Halter Marine unitis currently building the ship in Pascagoula, MS.

PHTL said “the project financing is guaranteed by the Maritime Administration's Title XI program, and performance and payment bonds are securely in place with Travelers Casualty and Surety for the full value of the shipbuilding contract. Halter and PHTL anticipate the bankruptcy proceedings will have little effect on the overall construction schedule but acknowledge the forecasted delivery of the vessel could slip by two or three months. PHTL remains confident their new service between California and Hawaii will be inaugurated by Fall 2002. Further updates will follow as the ship nears completion.

PHTL is a joint venture of The Pasha Group and Van Ommeren Shipping (USA) LLC.

Mosvold reacts to Frontline bidResponding to Frontline Ltd's announcement that it intends to present a NOK 5.50 public offer for all outstanding shares in Mosvold Shipping, Mosvold says that on the basis of valuations of its vessels by independent shipbrokers it estimates the net asset value per share to be materially higher than the Frontline offer.